"The list of new citizens of Malta … has enough well-known Russian names to drive home an uncomfortable truth for the Kremlin: the Russian elite doesn't feel attached to Putin's besieged fortress project", Leonid Bershidsky, a Russia expert at the Bloomberg news agency, said on Thursday (11 January).

"They're not emigrating … but they are unwilling to put all their eggs in Putin's basket, which is a source of constant annoyance for him," Bershidsky said.

'Maltanistan'

The influx of Russians also poses questions on the quality of Maltese due diligence in rooting out fraudsters and other undesirables.

The Maltese government has fiercely denied criticism that it was turning the island into the kind of haven for illicit Russian money that Cyprus has become.

Cyprus, which also sells passports in return for a €2 million investment, issued 2,000 new ones in the past two years, almost half of which went to Russians.

A leaked German intelligence report said in 2012 that Russian criminals had stashed billions of euros in Cypriot banks, amid questions to what extent the financial ties shaped Cyprus' Russia-friendly foreign policy.

The Maltese scheme is cheaper than the Cypriot one and does not require new nationals to regularly visit Malta.

The issues came to the fore last October when a car bomb murdered a Maltese journalist, Daphne Caruana Galizia, who claimed to have evidence that prime minister Joseph Muscat's chief-of-staff, Keith Schembri, was involved in laundering money from kickbacks by Russian passport applicants.

New EU elite

The 2016 list of new Maltese and EU citizens includes Leonid Korotkov, the former governor of a Siberian region whom Russian leader Vladimir Putin sacked for abuse of office.

It contains Igor Khudokormov and Leonid Levitin - two Russian offshore banking tycoons named in the so-called 'Panama Papers' leaks.

It also includes Ibrahim Waleed Alibrahim, a Saudi sheikh who was recently arrested on corruption charges, and Dragan Solak, a Serbian-Slovenian media magnate named in the so-called 'MaltaFiles' leak for having used a Maltese shell company to dodge taxes.

The Russian branch of Transparency International, an NGO, in a report out on Monday identified several shady Russian nationals who have settled in Malta.

It said the Maltese passport scheme had created "additional opportunities for corrupt officials".

"Such a scheme is attractive in that it allows laundering large sums of money … European banks consider holders of 'gold passports' as local residents, and not as suspicious foreigners. In fact, it is a question of reputation laundering," the NGO said.

See no evil

Muscat himself denied that Malta was being corrupted in an interview with the BBC also on Monday.

He said money laundering there was no greater a problem than it was in Luxembourg, the Netherlands, or the UK.

He also said he did nothing wrong in going to Dubai to promote the passport sales scheme in the same week last year as Caruana Galizia's assassination.

He dismissed her allegations about passport-sale kickbacks as being "false" and "dubious" social media "gossip".

"I'm in a quite horrible situation of having to criticise someone who was killed brutally," Muscat said.

Malta's finance minister Edward Scicluna told reporters that the Maltese-based entities named in the latest tax avoidance leaks are all listed on a public register. "There was no secrecy whatsoever," he said.